After reading the Canadian Centre for Policy Alternatives’ (CCPA) assertion that, together, the country’s 86 wealthiest residents could buy New Brunswick, lock, stock and barrel, and still have enough in the kitty to pay for a round-trip expedition to Mars, I have but one thing to say to that estimable, left-leaning think tank: Oh, you tease.
Perhaps our good premier, David Alward, and his finance minister, Blaine Higgs, have been approaching this economic development thing all wrong from the get-go. Their much-reviled predecessors in the Graham government may have been right, after all; they just didn’t go far enough. Sure, sell NB Power for a cool $4 billion if you can. But why stop there?
“New Brunswickers held $141 billion worth of assets in 2012,” writes the CCPA’s senior economist, David Macdonald, in his new paper, Outrageous Fortune: Documenting Canada’s Wealth Gap. “Of all of the provinces, this most closely approaches the net worth of The Wealthy 86 of $178 billion, without exceeding it.
“What this means is that The Wealthy 86 could buy up all of New Brunswickers’ 545,000 motor vehicles, all of their 314,000 houses and cottages, all of their undeveloped land, all of their stocks and bonds, all of their pension funds, all of their RRSPs, all of their jewellery, and all of their furniture. The Wealthy 86 have enough money to buy absolutely everything in the private hands of every New Brunswicker,
with billions to spare.” ($37 billion, to be precise).
Following the data’s release last week, and in the collective interest of the rest of us, local CBC radio host Paul Castle helpfully informed his listening audience that the per-capita haul on a bounty of 141 billion simoleons is $188,000, which isn’t bad. But, it’s nowhere near enough to propel anyone over the gates that surround the super-rich. And, of course, that’s the CCPA’s point.
“The latest Statistics Canada wealth survey reveals income in equality isn’t Canada’s only problem: wealth inequality in Canada is worse,” Mr. Macdonald observes “For instance, many gasp at the fact that Canada’s richest 20 per cent of families take almost 50 per cent of all income. But when it comes to wealth, almost 70 per cent of all Canadian wealth belongs to Canada’s wealthiest 20 per cent.”
All of which proves there’s truth in the old adage that you have to have moolah to make moolah; indeed, the more boodle you have, the more boodle you tend to generate (thanks to the miraculous effects of certain financial instruments, not least of which is compound interest).
Of course, real money is also incredibly rare. If everybody had it – lots of it – who would care about concepts of fairness predicated on simple pocket-book envy?Certainly, the CCPA wouldn’t, but that’s only because it would be out of job chronicling and cataloging the rapacity of the gilded galoots and pampered plunderers among us.
“The level of wealth inequality in Canada has reached such extremes that in 2012, according to figures derived from Canadian Business magazine, the 86 wealthiest Canadian-resident individuals (and families) held the same amount of wealth as the poorest 11.4 million Canadian combined,” Mr. Macdonald writes. “To put these findings into historical perspective, in 1999, The Wealthy 86 held the same wealth as the bottom 10.1 million Canadians.”
Naturally, Mr. Macdonald and his fellow travelers want Government (big surprise, here) to fix the situation and pronto.
Maybe it should remove some of the protections on wealth, such as the favorable capital gains tax rate (half of that levied against income), or slap new taxes on the income of the wildly wealthy on the theory is that such “progressive” moves will redistribute some of the accumulated capital to the rest of society where it can do some broad, general good.
It’s a nice theory that rests on only two flawed assumptions: first, that higher taxes on fat incomes will have any effect on “breaking up” private pools of capital; and, second, that capital gains exclusions will only affect the super-rich, and not the majority of entrepreneurs who dutifully ply their trades somewhere in the middle of the pack of affluence.
Nope, the solution is, was and and always shall be right in front of our faces: Persuade The Wealthy 86 to buy New Brunswick.
Make them an offer they can’t refuse: Throw in P.E.I. as a signing bonus. It won’t mind. Honest.